New non-contingent charging for defined benefit pension transfers – from October 1st, 2020
The FCA have ruled that from the 01.10.2020 all defined benefit (final salary) pension transfer advice must be provided on a non-contingent basis, excepting in some very limited circumstances. This means that irrespective of the outcome of the advice, the client will be paying the same fee, and if the outcome is not to transfer, this fee will be liable for VAT thus in effect costing the client more than a recommendation to transfer.
Contingent charging will be banned in most circumstances, with only those consumers who do not have the money available to pay for advice AND are either in serious ill health OR serious financial difficulties.
After October 1st, 2020 we will be able to offer a short form of advice, known as ‘abridged advice’. This is a simpler ‘low cost’ advice process which will allow us to make an assessment at an early stage to confirm you are unsuited to a transfer recommendation at this time.
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